Alternative Title

Finanzas descentralizadas: el futuro del sector financiero

Publication Type

Book Chapter

Version

publishedVersion

Publication Date

6-2022

Abstract

Decentralized Finance, known as DeFi, refers to the use of blockchain and digital assets or crypto-assets for the provision of financial services. Under this concept, services such as loans, insurance, crypto-asset exchanges, among others, are offered, are structured based on crypto-assets and through technologically decentralized applications. This chapter discusses the concept of DeFi and how it challenges the traditional market infrastructures of the financial sector, demystifying the idea of absolute decentralization, generally mentioned in the crypto-asset arena, from the perspective of decision-makers and governors of these decentralized applications. Subsequently, the chapter analyses the opportunities and challenges of DeFi for consumers, financial institutions, new competitors and financial regulators. Among the opportunities, the chapter explains how DeFi could contribute to financial inclusion, to the automation of certain financial products and how it is a key factor for the development of metaverses. As part of the challenges, the paper analyses the problems of money laundering and terrorist financing in these markets, financial consumer protection, corporate governance issues, the lack of transparency of these products, cybersecurity risks and systemic risk issues. Finally, the chapter addresses some early regulatory responses that policymakers have tried in response to some of these challenges in different jurisdictions.

Keywords

Financial services, blockchain, crypto-assets, financial regulation

Discipline

Banking and Finance Law | Finance and Financial Management | Technology and Innovation

Research Areas

Corporate, Finance and Securities Law

Publication

Reinventing Finance in the Digital Age / La Reinvencion Financiera en la Era Digital

Editor

Mauricio Valenzuela

First Page

34

Last Page

57

ISBN

:9789589040850

Publisher

Colombian Banking Association

City or Country

Santiago, Chile

Additional URL

https://asobancaria.com/wp-content/uploads/La_reinvencion_financiera_en_la_era_digital-2022.pdf

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